Interview With WordPress Creator Matt Mullenweg

“We’ve been proving them wrong since 2005.” Automattic founder Matt Mullenweg became CEO in January after Toni Schneider, right, moved to a product-focused role.

I sat down with Matt Mullenweg, the founder and CEO of WordPress’ parent company, Automattic, for an extended interview in March, just ahead of the company’s $160 million financing round a month later, which valued the company at $1.16 billion. (Apologies for posting this so long after the fact.)

For a company that powers 22% of the Web, including, the Series C round was appropriately hefty. But for Automattic, which has long defied the conventional tech trajectory, the raise was unusual; it’s the first, and by far the largest, injection of dilutive capital since 2008.

Given the newfound aggressiveness Mullenweg expressed in our interview in March, this makes some sense. After eight years as chairman, he became CEO of Automattic in January, replacing Toni Schneider who had guided the company since 2006. (Schneider is stepping into a more product-oriented role.) The company grew swiftly in the interim, but hardly at the breakneck pace expected of promising tech companies.

Now, after years of reluctance, Mullenweg is taking the brakes off.

For the average reader, the following transcript of our conversation, edited from about 13,500 words down to 2,800, is likely too long. But WordPress inspires a fervent-enough following that I suspect this will be too short for many.

In it we cover the CEO transition, the future of Automattic, the company’s business model, its distributed workforce, mobile, and the nature of press leaks, among other topics.

Happy reading.

“We’ve been proving them wrong since 2005.” Automattic founder Matt Mullenweg became CEO in January after Toni Schneider, right, moved to a product-focused role.
“We’ve been proving them wrong since 2005.” Automattic founder Matt Mullenweg became CEO in January after Toni Schneider, right, moved to a product-focused role.

FORBES: How are you liking the CEO role?

Matt Mullenweg: I’m loving it actually. It’s good to be in a role when you can learn something new. It’s very challenging, more so than I thought it would be.

When there’s no one you can point to or when something goes wrong, it’s your fault—that level of responsibility and accountability is pretty interesting. I didn’t anticipate there being a change and it’s actually been a big one.

FORBES: How has the texture of your day-to-day changed?

Mullenweg: I still spend about a third of my time on hiring. I wanted to maintain that. I spend less of my time on day-to-day programming. Like last year I lead a WordPress release, WordPress 3.8, when we did the big redesign. That was definitely down to the pixel. I was committing code and things. I don’t anticipate doing that this year. I hope to lead a WordPress release again maybe in a year or two. But right now I can’t even imagine.

FORBES: I’m kind of amazed that you were doing it just a year ago.

Mullenweg: Yeah, it came out December 12th. Last year was an exciting year. It was able to do that. Also the Tiger funding happened. They’ve been a great partner. It was nice to get some external validation for the company. Tiger is one of the most sophisticated investors in the world right now, literally.

Our last price was set in like 2008. It’s nice to know that between then and now, we’ve actually created some value.

FORBES: That was mostly secondary right?

Mullenweg: 100% secondary. We still haven’t raised any primary capital since 2008. We’re more in the school of thought of growing the business versus spending a lot of money and getting as much growth as possible.

Box, for example, is a company I love but they’re going public on something like hundreds of millions of dollars of losses.

The reason we built Automattic the way we have is because I think— every company says this, we try to live it as much as possible—independence gives you the most options. As a strong independent company we’re able to work with everyone: Google GOOGL -0.39%FacebookTwitter TWTR +1.05% et cetera. But if we were part of one of them we wouldn’t be able to do that. We’re able to make very long term investments.

There are things we’re launching this year that we’ve been working on literally for 3 or 4 years, that are not public. You can build a culture in a different way. I feel like when you’re constantly raising money and constantly going back to the till, it’s a little bit more transactional. People are getting options that vest over a set amount of time and that’s when they’re mostly done with the company. You’re constantly bribing the same set of people. Look at it: the same people who go to Microsoft MSFT -0.44% then went to Google and then they built Facebook and now they’re going to Dropbox. It’s essentially the same crew that just goes from company to company.

And most open source companies are not good. Meaning that you can’t look at a MySQL or something like that and say, “They did what was best for the community and they were really successful.” They sold for a billion dollars, good for them, but in the meantime they completely lost the database market.

They don’t have any sort of document database. They missed big data like Hadoop and they ultimately changed their licensing so that the open source part is now like a second class citizen.

Automattic is basically a big experiment. Can we create something that’s fully open source to the core, that becomes a big Internet-scale business?

They say it can’t be done but we’ve been proving them wrong since 2005. I look forward to continuing to do that.

FORBES: What are the main revenue drivers now?

Mullenweg: People think that WordAds and VIP are big parts of our business—they’re about 10% each. They’re important and for many reasons we invest in them, but the vast majority of revenue comes from subscriptions, the other 80%. So people signing up for to get extra features or a domain name.

Then for people who are hosted on Amazon or GoDaddy or those places we also have a set of products for them under Jetpack. Between and Jetpack, that’s the whole company basically.

FORBES: Jetpack is fairly recent, right?

Mullenweg: Jetpack is really important to us.

FORBES: Because it’s opened up the self-hosted community…

Mullenweg: Yes. Basically if you believe in Moore’s Law and you believe that hosting is going to become more and more commoditized over time, not being a host is a good idea. is a host at the end of the day. But we want to be able to provide a lot value and create a lot of value regardless of whether you host on or not. I mean, host on Amazon where they lower prices every year or Google App Engine or maybe Microsoft Azure will stop sucking.

But you’ll still use all of our services and you’ll still get all the benefits, even if you run it yourself—like easy connections to all the social networks, stats, subscriptions, dynamic images and video transcoding and all the stuff that’s expensive or difficult to do in a distributed fashion.

Very closely related to that is mobile. This new interface we’re building works fluently whether you’re on the desktop, a tablet or notebook and it’s a consistent experience between them. Right now only about 30% of our active users use our mobile apps and I want that to be half within a few months, and a plurality by the end of the year.

In 2012 we would have been around like probably about 1 in 6 websites, like 14% or 15% of the Web. We’ve grown that a lot, it’s now 21%. But of the websites in the world, only 3.5% use jetpack; but that 3.5% get’s so much traffic.

That’s 15% of WordPress users. We turned off Quantcast but before we turned it off in November that 15% got over 850 million monthly uniques. So the audience there is massive. Growing that from 15% of WordPress to 30% or 60% of WordPress drives a ton of activity.

FORBES: Are you in Automattic for life?

Mullenweg: Yes. I’m kind of a one trick pony.

FORBES: So when you think about Automattic 10 years from now, what’s your hope for the company?

Mullenweg: Ten years is a while out.

FORBES: Even 5 or 3.

Mullenweg: You know 10 years from now I want it to be an organization that has thousands of people. I think we can build, in a completely distributed, open source fashion, a 10 or 20 thousand-person company. I actually have no doubts about that. I don’t know in what timeframe it happens, but I know that we can do it because I’ve seen how we’ve been able to scale this to 240 and pass many of the barriers where people said the whole thing would break down. (Editor’s note: Automattic employs a distributed workforce around the world. The company’s largest office is in San Francisco, where only 15 of its 240 employees work.)

They said, “I know this distributed thing works when you’re 10 or 15 people, but if you’re 30, it doesn’t work.” Or it works at 30 but at 50 the company changes. People said that 150 was like the Dunbar’s Number. We keep blowing by these numbers and it’s like, “Wow. This is actually still working.”

FORBES: You said some things are easier now with 200 people as opposed to 100, what is easier?

Mullenweg: You can go both broad and deep. WordPress is a platform. There are almost infinite things you can do on top of that, 100 of which are really interesting businesses, probably 50 of which are multibillion dollar opportunities. Choosing what to work on is almost the hardest thing. So having more people allows us to expand our focus a little.

If you check out, it’s basically just a funnel to our hiring page. We don’t go to colleges, we don’t do recruiting, we don’t have internship programs. It’s pretty much all incoming.

The page shows US uniques in millions and the number of employees. So Google has 200 million uniques and like 40,000 employees. Then Facebook has 140 million and 6,000 people. Then we’re third and we are literally 10% the size of any of these other ones with similar audience size.

That’s why we can get some of the best people in the world to work on those problems. That’s why I work here.

FORBES: What’s your hiring schedule for the next year? Are you guys slowing down a little bit?

Mullenweg: It’s aggressive. That’s why I spend a third of my time of hiring.

FORBES: Is it going to be another 100, do you think?

Mullenweg: I can’t say exactly, but yes we’re growing as aggressively as possible. The gating factor is only our ability to find the best people. If I find 200 of them this year, we hire 200. If we only find 50 this year, we’ll only do 50.

FORBES: Why is the ramp up occurring now?

Mullenweg: There are a few things. One, we figured out how to do it. We couldn’t have hired 100 people even if we wanted to 2 years ago unless we compromised on quality. Two, and this is completely on me, I think the company was kept artificially small partially because I was uncomfortable with the idea of a larger organization. I didn’t know how we’d do it and still be good.

I felt like we would slow down as we got bigger, all the people would change or that it would become more corporate. I kind of just took the brakes off. I felt like I was artificially depressing it before and it was just one of those things I had to learn.

As an entrepreneur, people could tell me one way or another and until I had experienced it myself I didn’t really, deeply understand how we would build an organization of that scale and still be someplace I wanted to work.

So for example, our teams never have budgets. They don’t have P & L’s, they don’t have caps on how many people they can have.

We just look at the company as a whole. Maybe there’s a team of 4 people that throws off like $10 or $15 million in revenue. Or maybe there’s a team of 40 people that barely makes any money, or loses $10 or $15 million. Things basically balance out between them.

That mentality shift is almost inconceivable if you are on the other side. And it’s just dumb rules that make governments and companies enforce it. Like the idea that you have a certain budget for this year and if you don’t spend it, it goes down next year. What kind of behavior does that lead to? It means that on December 31st I’m going to throw a giant party for the team or something.

Headcount stuff, budgeting, P & L’s, I just think those don’t really matter. In some ways I’m a non-traditional executive. But part of what we do, myself and Stu the CFO, is we worry about that so no one else in the company has to.

FORBES: They just focus on product.

Mullenweg: They just worry about the product. Make the best thing. That’s hard enough. Don’t worry about whether your team hired someone that put you over budget for the year. Something like that has nothing to do with creating great products.

FORBES: You guys shoulder all the administrative and financial stuff so they don’t have to?

Mullenweg: It’s a burden I will happily bear. The majority of the company isn’t focused on making money. It’s a very small percentage. The circle gets smaller and smaller. It’s like two or three people who worry about everything a lot, so no one else has to at all.

FORBES: You share all of your internal numbers with the company. You subscribe to this idea of complete transparency right?

Mullenweg: It’s not 100%. There are certain things that we hold back–sensitive HR stuff or things that we’re not ready to announce yet. If we’re doing an acquisition, like four people in the company know about it until the day before. Sorry about that by the way.

But there have never been any leaks from Automattic.

For the $125 million from Tiger, that was a tender offer. Every single person in the company knew that a month before. It closed and then we announced it a week or two after that. So there was like a six week time period when 200+ people knew that $125 million was changing hands.

FORBES: All of your financial statements are shared internally?

Mullenweg: That’s all internal, yes.

FORBES: Why do you think that hasn’t been leaked? Has there been any effort around that, any concern?

Mullenweg: There are much bigger companies than us that don’t worry about leaks, like Apple AAPL -0.03% with thousands and thousands of people. I think it’s just when the company treats you well, why would anyone leak? That may be a better way to look at it. What company leaks the most in the world? I’ll give you a hint, think Kara Swisher.

FORBES: Google?

Mullenweg: No.

FORBES: Yahoo?

Mullenweg: Yes. Every memo they send out, they might as well just put Kara on the distribution list. There’s been so much turnover there as well. I wonder if there’s just one exec there that secretly hates the company.

Why do you leak things? Could be that you’re mad at the company, or you’re jockeying for power internally so you’re using a leak to get your position. They have motivations. They’re not doing it for the altruistic benefit of Forbes pageviews.

If you’re able to create an environment which is free from those politics, it’s less likely for something to leak for that reason.

FORBES: I’m curious about how you feel about your mobile products right now. It seems like you’re not very happy with them.

Mullenweg: I think we need to do a hard swing as a company. We’re a Web company. We grew up on the Web, we grew up with mice and keyboards and we live in a touch world now. We have an incredible growing business from people who are currently able to use our products, which are desktop users. We’re not going to launch anything anymore ever again, that’s not responsive. Right now we have 10 mobile developers in the company spread across teams. They’re starting to train other developers.

So in addition to our aggressive hiring on the mobile side and acquisitions, we’re going to start converting our existing engineers to be mobile first. I would hate to have to do this at a 20,000-person company because it’s hard enough as 200-person company. Our DNA is more Web. But part of the reason I’m passionate about continuing to scale Automattic is to show it can be done.

The mobile world is very closed and proprietary just by definition. Android is open source-ish but not really. iOS is locked down. I want to be more of a mobile company but as we do that I don’t want to lose the things that make us the engine of the independent Web.

We’re going to try to bring to mobile the thing that allows us to power the dark matter of the Internet. To be super diverse and allow thousands of businesses and hundreds of thousands of people to build a living on top of it. I want to bring that to mobile however we can. It’s difficult because there are closed things around payments and there are closed things around app stores and how you code things.

It’s going to be tough but no one else is working on it. Maybe Mozilla with their operating system. Maybe Ubuntu. I don’t think another operating system is the right way to approach it. I think that we can go into Android and iOS and build a product that is both widely adopted from a consumer point of view, with tens or thousands or millions of users, and open.

We’ll see. It’s not going to be easy. But I didn’t sign up for easy.


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